Australian banks struggling to generate profit growth in Australia this year are unlikely to find much relief from their Kiwi banking arms.ANZ yesterday stumped up further evidence that the slowdown in the banking sector was very much a trans-Tasman phenomenon, with its New Zealand operation reporting a sharp slide in profitability.ANZ's Kiwi arm posted a net profit of NZ$467 million in the December quarter - down almost 8.5 per cent on the corresponding period in 2017.The main driver of the result was a collapse in fee income, which almost halved to NZ$109 million on the back of large foreign exchange losses. The forex losses totalled NZ$51 million for the quarter compared to net gains of NZ$78 million in the 2017 December quarter. New Zealand's dollar appreciated against the Australian and US currencies in the three months to the end of December 2018.The reported fee income would have been worse had the bank not booked a gain of NZ$58 on the sale of its OnePath operation to Cigna Corporation during the quarter.However, disclosures in the notes to the quarterly accounts indicate that this reported net gain might be exposed to revision "as the sale price and transaction costs are finalised in the first half of the 2019 financial year".There were several positive dimensions to the subsidiary's performance in terms of lending and credit quality.ANZ grew the size of its home loan book during the quarter by NZ$1.4 billion or 2 per cent.The solid growth bolstered the net interest line, which grew by 5 per cent to NZ$824 million.Credit quality is also holding up, with impairment charges rising only NZ$1 million in the quarter.Investors reacted tepidly to the disclosure.  ANZ's Kiwi-listed scrip closed up 1 cent to NZ$27.75, while the ASX-listed share price lost 7 cents to A$26.74.